ACIT, UDAIPUR V. M/s. Adeesha Carrier, UDAIPUR

ITA 406/JODH/2013

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 82968 (ITAT-JODHPUR)
• Duration Of Justice: 1 year(s) 3 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-09-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 08-09-2014
• Assessment Year: 2006-2007
• Appeal Filed On: 14-06-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: G K GARGIEYA; DINESH SHRIMALI
• Keywords: Unexplained expenditure
• Section: 131

Judgement Text

IN THE INCOMETAX APPELLATE TRIBUNAL JODHPUR BENCH: J ODHPUR ( BEFORE SHRI H ARI OM MARATHA, JUDICIAL MEMBER AND SHRI N.K. SAINI, ACCOUNTANT MEMBER ) I.T.A. NO. 406 /JODH/201 3 (A.Y. 200 6 - 0 7 ) ACIT, CIRCLE - 2 VS M/S. ADEESHA CARRIER UDAIPUR. MADRI , UDAIPUR. PAN NO. AALFA1190Q (APPELLANT) (RESPONDENT) ASSESSEE BY : - SHRI G.K. GARGIEYA, AND SHRI DINESH SHRIMALI. DEPARTMENT BY : - SHRI MAHESH KUMAR - D.R. DATE OF HEARING : 08 /0 9 /201 4 DATE OF PRONOUNCEMENT : 1 8 / 0 9 /2014 O R D E R P E R HARI OM MARATHA, J.M. : THIS APPEAL OF THE REVENUE, FOR A.Y. 2006 - 07, IS DIRECTED AGAINST THE ORDER OF LD. CIT(A) DATED 28.03.2013. 2. THE ASSESSEE IS A PARTNERSHIP FIRM, N WHICH SHRI PRITAM SINGH, SMT. SURJEET KAUR, SHRI RA VINDRA SINGH, SHRI DEVENDRA S INGH AND SMT. MAMTA ARORA ARE PARTNERS. THIS FIRM IS ENGAGED IN THE BUSINESS OF 2 TRANSPORTATION. FOR A.Y. 2006 - 07, THIS FIRM HAS FILED ITS RETURN OF INCOME (ROI) ON 31.10.2006, DECLARING INCOME OF RS. 3,61,002/ - . IN THIS YEAR IN TRANSPORTATION BUSINESS N.P. RATE OF 8.51% HAS BEEN DECLARED. IT WAS NOTICED THAT THE ASSESSEE - FIRM HAS CLAIMED TO HAVE MADE CERTAIN PAYMENTS TO THE FOLLOWING PARTIES AGAINST THE MOTOR BODY REPAIRING WORKS. THE ASSESSEE PRODUCED BILLS ETC TO PROVE THESE P AYMENTS TO FOLLOWING PARTIES : - 1. M/S. SONAL MOTOR BODY REPAIRING WORKS OPP. FIELD CLUB, UDAIPUR. 2. M/S. BHERU BHAWANI MOTOR BODY REPAIRS, GANOLI, AIRPORT ROAD, UDAIPUR. TO VERIFY THE A.O. ISSUED SUMMONS U/S 131 OF THE ACT TO THE ABOVE PARTIES AND RECORDE D STATEMENT OF SHRI LOGAR LAL S/O SHRI JODHAJI WHO APPEARED ON BEHALF OF M/S. SONAL MOTOR BODY REPAIRING WORKS. HE PARTLY REFUSED TO HAVE EITHER DONE ANY SUCH WORK FOR THE ASSESSEE OR HAVING ISSUED SHOWN BILLS. HE ALSO DENIED TO HAVE PUT HIS SIGNATURES ON THE BILLS AS HAS BEEN CLAIMED BY THE ASSESSEE. HOWEVER, HE STATED THAT HE WAS NOT AWARE ABOUT THIS FIRM BUT KNEW SHRI PRITAM SINGH AND SHRI R A VINDER SINGH AND HAD DONE WORK FOR THEM. SIMILARLY SUMMONS U/S 131 WAS ISSUED TO THE M/S. BHAIRU BHAWANI WORKS ON 21.10.2008. ON ITS BEHALF UDAI LAL LOHAR ATTENDED WHOSE STATEMENT WAS RECORDED ON 3 OATH, IN WHICH HE STATED THAT NO SUCH WORK WAS DONE FOR M/S. ADHEESHA CARRIERS DURING THE F.Y. 2005 - 06. THE A.O. SOUGHT EXPLANATION ON THE BASIS OF THE ABOVE REVELATIONS AND THE ASSESSEE SUBMITTED THAT WHEN BOTH THE ABOVE PARTIES WERE CONTRACTED THEY STATED THAT THERE WAS LITTLE CONFUSION AND THEY COULD NOT PROPERLY UNDERSTAND THE QUESTIONS PUT TO THEM. THEY CONFIRMED HAVING DONE WORK OF THE ASSESSEE AND ALSO CONFIRMED RECEIPT OF SAID PAYMENT. HOWEVER, WITH REFERENCE TO THE MANNER IN WHICH THE ASSESSEE HAS MAINTAINED ITS ACCOUNTS ETC AND ALSO ON RELYING THE ABOVE STATEMENT, HAS DISALLOWED THESE EXPENSES AND AHS ADDED THEM IN ITS HANDS IN THE A.Y. 2006 - 07. AS AGAINST WHICH, THE LD. CIT(A) HAS DELETED THIS ENTIRE ADDITION. THE REVENUE HAS CHALLENGED THE IMPUGNED DELETION. 2.1 BEFORE US BOTH THE PARTIES HAVE REITERATED THEIR EARLIER ARGUMENTS. IT IS UNDENIABLE FACT THAT THE ASSESSEE HAS CLAIMED REPAIR EXPENSES REGARDING THE BODY OF MOTORS TOTALING TO RS. 12,24,850/ - (RS. 5,47,000/ - + RS. 6,77,850/ - ) FROM THE TWO PARTIES MENTIONED ABOVE. THE ASSESSEE PRODUCED BILLS AND PROOF OF PAYMENTS. THE A.O. RECORDED THE STATEMENTS FROM TWO THE CONCERNED PERSONS OF BOTH THE PAYEES. BOTH OF THE M HAVE DENIED ANY CLAIMED WORK BEEN EXECUTED AND ALSO ISSUANCE OF BILLS THEREFORE. THEY HAVE ALSO DENIED THAT THEY HAVE RECEIVED ANY SUCH PAYMENTS FROM THE ASSESSEE. THEY HAVE STATED THAT 4 NO SUCH WORK WAS DONE BY THEM DURING THE YEAR. WHEN THIS FACT WAS BR OUGHT TO THE NOTICE OF THE ASSESSEE, HE FILED DULY SWORN IN AFFIDAVITS OF BOTH THOSE PERSONS WHOSE STATEMENTS WERE RECORDED BY THE A.O. U/S 131 OF THE ACT. IN THESE AFFIDAVITS, BOTH OF THEM HAVE CONFIRMED THE CLAIM OF THE ASSESSEE, IN TOTO. THE ASSESSEE HA S PRODUCED THESE AFFIDAVIT ALONG WITH A COVERING LETTER IN WHICH THE CIRCUMSTANCE SIN WHICH THESE AFFIDAVITS ARE SWORN - IN BY THOSE PARTIES AND AS TO WHY THEY REFUSED THE CLAIM OF THE ASSESSEE INITIALLY WHEN CALLED U/S 131 OF THE ACT. BE THAT AS IT MAY WHEN THE ASSESSEE MADE A CLAIM OF MAKING ABOVE PAYMENTS TO THE RESPECTIVE PARTIES AND PRODUCED BILLS AND VOUCHERS, THE PRIMARY ONUS CAST ON THE ASSESSEE STOOD DISCHARGED. BUT, AFTER BOTH THE PAYEES DENIED THIS CLAIM OF THE ASSESSEE VIA THEIR STATEMENTS RECORDE D U/S 131, THE ONUS AGAIN SHIFTED ON THE ASSESSEE TO ESTABLISH ITS CLAIM. THE ASSESSEE H A S PRODUCED THE SWORN AFFIDAVITS OF BOTH THE PAYEES. IN THIS AFFIDAVIT THEY HAVE CONFIRMED CLAIM OF THE ASSESSEE INCH - BY - INCH. THE AVERMENTS OF THESE AFFIDAVITS REMAINE D UNCONTROVERTED AS THE A.O. DID NOT PROCEED FURTHER IN THE MATTER. BY THE VERSION OF THE AFFIDAVITS NOT ON L Y THE EFFECT OF THE STATEMENTS GETS DISSOLVED BUT ALSO THE REASON AS TO WHY AND HOW SUCH STATEMENTS WERE MADE BY THEM GETS EXPLAINED. SO, WE CAN SAY THAT THE ONUS THUS SHIFTED ON THE ASSESSEE, AGAIN GETS DISCHARGED. WE MAY HASTILY ADD 5 THAT ANY STATEMENT RECORDED AT THE BACK OF THE PERSON AGAINST WHOM SUCH STATEMENT IS LIKELY TO BE USED MUST BE GIVEN OPPORTUNITY TO CROSS EXAMINE THE DEPONENT, WHICH HAS NOT BEEN DONE. ON THE OTHER HAND AFTER RECEIPT AND PERUSAL OF THE AFFIDAVITS, THE A.O. DID NOT EXAMINE THE DEPONENTS. THE PAYMENTS ARE THROUGH ACCOUNT PAYEE CHEQUE WHICH IS AN IMPORTANT ASPECT AND THE SAME HAS NOT BEEN VERIFIED BY THE A.O. THE CUMULATIVE EFFECT OF THE CLAIM AND THE COUNTER CLAIM INCLUDING THE EVIDENCE PRODUCED BY THE ASSESSEE AND GATHERED BY THE A.O., IS THAT THESE EXPENSES HAVE TO BE TREATED AS GENUINE. ACCORDINGLY, WE HOLD THAT LD. CIT(A) HAS CORRECT DELETED THE IMPUGNED ADDITION. THUS, GROUND NO. (1) OF REVENUES APPEAL STANDS DISMISSED. 3. GROUND NO. (2) IS REGARDING DELETION OF AN ADDITION OF RS. 67,860/ - MADE ON ACCOUNT UNEXPLAINED EXPENDITURE IGNORING THE FACT OF THE CASE THAT THE ASSESSEE HAD FAILED TO FURNISH THE CONFIRMATION OF SUCH EXPENDITURE. THE FACT APROPOS THIS GROUND ARE THAT THE A.O. ASKED THE ASSESSEE TO FILE BLANKET CONFIRMATION FROM THE PARTIES TO WHOM PAYMENTS MORE THAT RS. 50,000/AND ABOVE WERE MADE. THE ASSESSEE MADE THIS PAYMENT OF RS. 67,860/ - TO M/S. SHREE NATH T YRES RETREADERS. SINCE THIS ENTITY HAD SOLD THIS PLANT TO OTHER ENTITY. THAT IS WHY WHEN NO CONFIRMATION OF THIS PAYMENT COULD BE FILED THE A.O. 6 ADDED THIS AMOUNT OF RS. 67,860/ - WHICH HAS BEEN DELETED BY LD. CIT(A). 3.1 BEFORE US BOTH PARTIES HAVE REITE RATED THEIR EARLIER ARGUMENTS. WE HAVE FOUND THAT THE A.O. DID NOT SPECIFICALLY ASKED THE ASSESSEE TO PRODUCE CONFIRMATION FORM M/S. SHREE NATH TYRE RETREADERS TO WHOM PAYMENT OF RS. 67,860/ - WAS MADE. IN FACT , THIS PAYMENT WAS MADE THROUGH ACCOUNT PAYEE C HEQUES AND ARE VERIFIABLE FROM THE BANK STATEMENT FILED ALONG WITH THE BILLS AND LEDGER ACCOUNT. IN THESE CIRCUMSTANCES, THE REASON FOR DISALLOWANCE IS NOT JUSTIFIED. IN OUR CONSIDERED OPINION THE LD. CIT(A) HAS CORRECTLY DELETED THIS ADDITION. THUS, GROUN D NO. (2) IS DISMISSED. 4. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE COURT ON 18 TH SEPTEMBER , 2014. SD/ - SD/ - (N.K.SAINI) [HARI OM MARATHA] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 18 TH SEPTEMBER , 2014 VL/ - 7 COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT BY ORDER 4. THE CIT(A) 5. THE DR SENIOR PRI VATE SECRETARY ITAT, JODHPUR